First-Time Home Buyer Tax Credit

If you are considering the purchase of a home, you've probably heard about the first time home buyer tax credit. Despite the program name, the tax credit is available to anyone that has not owned a home in the past 3 years, not just those buying a home for the very first time.

Also, the home must be your primary residence and you'll have to file your taxes to receive the tax credit. Many people believe that this money can be used upfront for the purchase of the home but the funds will not actually be available to you until you amend your 2008 tax return or file your 2009 tax return.

Its also important to note that you may not receive the entire $8,000 tax credit. This is because its based on the purchase price of the home. The tax credit is equal to 10% of the purchase price of your home. This means you'd have to purchase your home for $80,000 to receive the entire $8,000 tax credit. If you took advantage of the $39,000 foreclosure I posted last week then you would only receive a $3,900 credit if you paid full price for the home.

For more information on the tax credit, check out the following links.
IRS: First Time Home Buyer Tax Credit
FAQ about First Time Home Buyer Tax Credit